Q&A Hero

Q: _________________________ is the electronic transfer of cash from one party to another.

Q: A ________ is a document signed by the depositor instructing the bank to pay a specified amount of money to a designated recipient.

Q: ________________________ refers to a company's ability to pay for its short-term obligations.

Q: ________________ includes currency, coins, and amounts on deposit in checking accounts and many savings accounts.

Q: ____________ are short-term, highly liquid investment assets that are readily convertible to a known amount of cash.

Q: Having external auditors test the company's financial records and evaluate the effectiveness of the internal control system is part of the internal control principle of ________________________.

Q: A person who controls or has access to an asset must not keep that asset's accounting records. This refers to the internal control principle of ________________________.

Q: A sales system with prenumbered, controlled sales slips is an example of the internal control principle of _______________________.

Q: Two sales clerks should not share the same cash register. This refers to the internal control principle of _______________________.

Q: An employee is __________ when a company purchases an insurance policy against losses from theft by that employee.

Q: An internal control system refers to the policies and procedures managers use to __________, ensure reliable accounting, promote efficient operations, and urge adherence to company policies.

Q: A company established a petty cash fund in May of the current year and experienced the following transactions affecting the fund during May: May 1 Establish petty cash account in the amount of $300. May 5 Paid for miscellaneous office supplies in the amount of $53.22. May 9 Reimbursed Human Resource Manager for business lunch, $45.09. May 15 Paid for minor landscaping services, $75. May 22 Paid $65.00 for postage. May 31 Counted remaining cash and discovered that $56.34 remained. The company decided to increase the petty cash balance to $450. Prepare the journal entry to increase the fund on May 31.

Q: A company established a petty cash fund in May of the current year and experienced the following transactions affecting the fund during May: May 1 Establish petty cash account in the amount of $300. May 5 Paid for miscellaneous office supplies in the amount of $53.22. May 9 Reimbursed human resource manager for business lunch, $45.09. May 15 Paid for minor landscaping services, $75. May 22 Paid $65.00 for postage. May 31 Counted remaining cash and discovered that $56.34 remained. Prepare the journal entry to reimburse the fund on May 31.

Q: A company established a petty cash fund in May of the current year and experienced the following transactions affecting the fund during May: May 1 Establish petty cash account in the amount of $300. May 5 Paid for miscellaneous office supplies in the amount of $53.22. May 9 Reimbursed human resource manager for business lunch, $45.09. May 15 Paid for minor landscaping services, $75.00. May 22 Paid $65.00 for postage. May 31 Counted remaining cash and discovered that $56.34 remained. Prepare the journal entry to establish the fund on May 1.

Q: Highlight Hotel deposits all cash receipts on the day when they are received and it makes all cash payments by check. At the close of business on December 31, its Cash account shows a $18,393, debit balance. Highlight Hotel's June 30 bank statement shows $15,921 on deposit in the bank. Prepare the necessary adjusting journal entries using the following information: Outstanding checks as of December 31 total $2,261. The December 31 bank statement included a $35 debit memorandum for bank services. Check No. 2519, listed with the canceled checks, was correctly drawn for $850 in payment of a utility bill on December 16. Highlight Hotel mistakenly recorded it with a debit to Utilities Expense and a credit to Cash in the amount of $805. The December 31 cash receipts of $3,425 were placed in the banku2019s night depository after banking hours and were not recorded on the December 31 bank statement. The bank statement included a check from a customeru2019s payment of an account receivable that had been returned NSF in the amount of $1,228. Prepare the necessary adjusting journal entries.

Q: The following information is available for the Edwards Company for its March 31 bank reconciliation: From the March 31 bank statement: Previous Balance Total Checks and Debits Total Deposits and Credits Current Balance $10,908 $7,805 $11,905 $15,008 Checks and Debits Deposits and Credits Daily Balance Date No. Amount Date Amount Date Amount 03/03 2874 1,210 03/02 4,340 03/01 10,908 03/11 2906 3,850 03/27 7,270 03/02 15,248 03/15 2905 170 03/31 295 IN 03/03 14,038 03/25 2910 725 03/11 10,188 03/29 2908 1,350 03/15 10,018 03/30 500 NSF 03/25 9,293 03/27 16,563 03/29 15,213 03/30 14,713 03/31 15,008 NSF: A check from a customer, Cook Co. in payment of their account. IN: Interest earned on the account. From the Edwards Company's accounting records: Cash Receipts Deposited Cash Disbursements Date Cash Debit Check No. Cash Credit March 7 4,340 2905 170 27 7,270 2906 3,850 31 2,090 2907 460 13,700 2908 1,350 2910 725 2911 340 6,895 Cash Acct. No. 101 Date Explanation PR Debit Credit February 28 Balance 9,698 March 31 Total receipts R4 13,700 23,398 31 Total disbursements D5 6,895 16,503 a. Based on the above information, prepare a bank reconciliation for the Edwards Company. b. Prepare the necessary general journal entries to adjust cash to the reconciled balance.

Q: Brown Company's bank statement for September 30 showed a cash balance of $1,350. The company's Cash account in its general ledger showed a $995 debit balance. The following information was also available as of September 30. a. A customer's check for $100 marked NSF was returned to Brown Company by the bank. In addition, the bank charged the company's account a $25 processing fee. b. The September 30 cash receipts, $1,250, were placed in the bank's night depository after banking hours on that date and this amount did not appear on the September 30 bank statement. c. A $15 debit memorandum for checks printed by the bank was included with the canceled checks. d. Outstanding checks amounted to $1,145. e. A customer's note for $900 was collected by the bank. A collection fee of $25 was deducted by the bank and the difference was deposited in the account. f. Included with the canceled checks was a check for $275, drawn on another company, Browne Inc. (a) Prepare a bank reconciliation as of September 30. (b) Prepare any necessary adjusting journal entries necessary as a result of the bank reconciliation.

Q: Based on the following information, prepare the general journal entries Avisa must make at November 30. The following information is available for the Avisa Company for the month of November: a. On November 30, after all transactions have been recorded, the balance in the company's Cash account has a balance of $27,202. b. The company's bank statement shows a balance on November 30 of $29,279. c. Outstanding checks at November 30 include check #3030 in the amount of $1,525 and check #3556 in the amount of $1,459. d. A credit memo included with the bank statement indicates that the bank collected $780 on a noninterest-bearing note receivable for Avisa. The bank deducted a $10 collection fee and credited the remainder of $770 to Avisa's account. e. A debit memo included with the bank statement shows a $67 NSF check from a customer, J. Brown. f. A deposit placed in the bank's night depository on November 30 totaled $1,675 and did not appear on the bank statement. g. Examination of the checks on the bank statement with the entries in the accounting records reveals that check #3445 for the payment of an account payable was correctly written for $2,450, but was recorded in the accounting records as $2,540. h. Included with the bank statement was a debit memorandum in the amount of $25 for bank service charges. It has not been recorded on the company's books.

Q: Based on the following information, prepare the November bank reconciliation for the Avisa Company. The following information is available for the Avisa Company for the month of November: a. On November 30, after all transactions have been recorded, the balance in the company's Cash account has a balance of $27,202. b. The company's bank statement shows a balance on November 30 of $29,279. c. Outstanding checks at November 30 include check #3030 in the amount of $1,525 and check #3556 in the amount of $1,459. d. A credit memo included with the bank statement indicates that the bank collected $780 on a noninterest-bearing note receivable for Avisa. The bank deducted a $10 collection fee and credited the remainder of $770 to Avisa's account. e. A debit memo included with the bank statement shows a $67 NSF check from a customer, J. Brown. f. A deposit placed in the bank's night depository on November 30 totaled $1,675 and did not appear on the bank statement. g. Examination of the checks on the bank statement with the entries in the accounting records reveals that check #3445 for the payment of an account payable was correctly written for $2,450, but was recorded in the accounting records as $2,540. h. Included with the bank statement was a debit memorandum in the amount of $25 for bank service charges. It has not been recorded on the company's books.

Q: Following are seven items (a) through (g) that would cause Xavier Company's book balance of cash to differ from its bank statement balance of cash. a. A service charge imposed by the bank. b. A check listed as outstanding on the previous period's reconciliation and still outstanding at the end of this month. c. A customer's check returned by the bank is marked "Not Sufficient Funds. (NSF)" d. A deposit that was mailed to the bank on the last day of the current month and is unrecorded on this month's bank statement. e. A check paid by the bank at its correct $190 amount was recorded in error in the company's Check Register at $109. f. An unrecorded credit memorandum indicated that bank had collected a note receivable for Xavier Company and deposited the proceeds in the company's account. g. A check was written in the current period that is not yet paid or returned by the bank. Indicate where each item (a) through (g) would appear on Xavier Company's bank reconciliation by placing its identifying letter in the parentheses in the proper section of the form below. Bank Statement Cash Balance Book Balance of Cash Add: ( ) Add: ( ) ( ) ( ) ( ) ( ) ( ) ( ) Deduct: ( ) Deduct: ( ) ( ) ( ) ( ) ( ) ( ) ( ) Reconciled balance Reconciled balance

Q: A company established a petty cash fund in February of the current year and experienced the following transactions affecting the fund during February: Feb. 1 Established a $250 petty cash fund. 5 Paid $55 to acquire office supplies. 8 Reimbursed the company controller for $30 spent on beverages for recruits. 18 Paid $45 for postage. 20 Paid $65 for C.O.D. charges on merchandise inventory. 25 Paid $50 for janitorial services. 28 When sorting the petty cash receipts to replenish the fund, the custodian noted that there was $245 in receipts and $10 cash remaining. Also, a decision was made to reduce the fund to $200 in total. Prepare the journal entry to reimburse the fund and to reduce its amount on February 28.

Q: A company established a $400 petty cash fund by issuing a check to the custodian on October 1. On October 15, the petty cash fund was replenished and increased to $1,000 in total. The contents of the petty cash fund at the time of the October 15 replenishment were: Currency and coins $ 12 Petty cash receipts for: Transportation-in for inventory $ 39 Delivery expense 138 Repairs to office equipment 47 Postage 114 Entertainment of customers 53 391 Total $ 403 Prepare the general journal entry to record both the reimbursement and the increase of the petty cash fund on October 15.

Q: A company established a petty cash fund of $100 on September 1. On September 10, the petty cash fund was replenished when there was $16 remaining and there were petty cash receipts for: office supplies, $27; courier, $32; and postage, $22. On September 15, the petty cash fund was increased to $125 in total. Record the above transactions in general journal form.

Q: On August 17, at the end of the day, the cash register's record shows $957, but the count of cash in the register is $965. Prepare the general journal entry to record the day's cash sales.

Q: A company reported net sales for Year 1 of $285,000 and $575,000 for Year 2. The year-end balances of accounts receivable were $49,000 for Year 1 and $85,000 for Year 2. Calculate the days' sales uncollected at the end of each year for this company and describe any changes in the apparent liquidity of the company's receivables.

Q: Hasbro had $2,816 million in sales and $555 million in ending accounts receivable for the current period. For the same period, Mattel reported $4,885 million in sales and $491 million in ending accounts receivable. Calculate the days' sales uncollected for both companies as of the end of the current period. Which company is doing a better job in managing the collection of its receivables?

Q: At the end of the current period, a company reported $475,000 in net credit sales and $75,000 in ending accounts receivable. Calculate this company's days' sales uncollected at the end of the current period.

Q: Michael Inwald of CHEESEBOY maintains a system of internal controls and managing cash. Identify some of these internal controls and explain how they contribute to the success of the company.

Q: What are the checks that must be completed prior to the completion of invoice approval and voucher preparation?

Q: Discuss the purpose of a bank reconciliation.

Q: What is the purpose of the petty cash account?

Q: Discuss how the principles of internal control apply to cash receipts.

Q: What is a voucher system?

Q: Describe the banking activities that promote the control of cash and identify the internal control objectives served by the banking activities.

Q: Explain the differences between cash and cash equivalents.

Q: List the main principles of internal controls.

Q: Define an internal control system and describe the purpose that it serves.

Q: Identify whether each of the following items would on appear on the bank side or the book side of a bank reconciliation: 1. Bank service charges. Book 2. The bank printed checks for the depositor for a fee. Book 3. NSF check. Book 4. Bank debit memorandum. Bank 5. The bank collected a $1,000 note for the depositor. Book 6. Bank credit memorandum. Book 7. Interest on a checking account. Book 8. The bank incorrectly recorded a check for $9.58. The company properly wrote the check for $95.80. Book

Q: Match the following terms with the appropriate definition:. 1. An asset such as cash that can be readily used to settle short-term obligations. Cash 2. Currency, coins, and amounts on deposit in bank checking and many savings accounts. Cash equivalent 3. An internal document listing the goods needed by a department and requesting that it be purchased. Check 4. Short-term, highly liquid investments that are readily convertible to known cash amount and are sufficiently close to their maturity date so that the market value is not sensitive to interest rate change. Outstanding checks 5. An itemized statement of goods prepared by the vendor that lists the customer's name, the items sold, the sales price of each item, and the terms of sale. Liquid asset 6. All the policies and procedures managers use to protect assets, ensure reliable accounting, promote efficient operations, and urge adherence to company policies. Internal control system 7. Money kept to cover the cost of small incidental payments. Petty cash fund 8. Checks written by the depositor, deducted on the depositor's records, sent to the payees, but not yet received by the bank for payment. Vendor 9. A document signed by the depositor instructing the bank to pay a specified amount to a designated recipient. Purchase requisition 10. The seller of goods or services. Invoice

Q: Identify each of the following items as either (a) cash or (b) cash equivalent. 1. U.S. treasury bills Cash 2. Commercial paper Cash 3. Certified check Cash equivalent 4. Currency Cash equivalent 5. Coins Cash 6. Three-month certificate of deposit Cash 7. Money market accounts Cash 8. Money orders Cash 9. Cashier's check Cash 10. Petty cash Cash equivalent

Q: Match each of the following transactions with the applicable internal control principle. 1. A company uses a check protector. Establish responsibility. 2. A company has separate departments for purchasing, receiving and accounts payable. Divide responsibility for related transactions. 3. A company buys an insurance policy to protect against employee theft. Establish responsibility. 4. A company uses a computerized point of sale system. Separate recordkeeping from custody of assets. 5. A company uses a voucher system. Apply technological controls. 6. A company hires CPAs to perform an audit. Perform regular and independent reviews. 7. No two clerks share the same cash drawer. Insure assets and bond employees. 8. A company has an internal auditor on staff. Divide responsibility for related transactions. 9. Cashier does not have access to the cash register recorded tape or file. Perform regular and independent reviews. 10. The bookkeeper prepares and signs checks. Apply technological controls.

Q: A company purchases merchandise on November 2 at a $2,400 invoice price (terms 3/10, n/30) and then pays all amounts owed on December 2. Using periodic inventory and net purchases methods, what are the proper entries to record these two transactions? A. Nov. 2 Merchandise Inventory 2,400 Accounts Payable 2,400 nventoryDiscounts Lostecord these two transactions.thod, what are the proper entries to record the pury purchases Dec. 2 Accounts Payable 2,400 Cash 2,400 B. Nov. 2 Purchases 2,328 Accounts Payable 2,328 Dec. 2 Accounts Payable 2,328 Cash 2,328 C. Nov. 2 Merchandise Inventory 2,328 Accounts Payable 2,328 Dec. 2 Accounts Payable 2,328 Purchase Discounts Lost 72 Cash 2,400 D. Nov. 2 Merchandise Inventory 2,328 Accounts Payable 2,328 Dec. 2 Accounts Payable 2,328 Inventory 72 Cash 2,400 E. Nov. 2 Purchases 2,328 Accounts Payable 2,328 Dec. 2 Accounts Payable 2,328 Purchase Discounts Lost 72 Cash 2,400

Q: A company purchases merchandise on November 2 at a $2,400 invoice price (terms 3/10, n/30) and then pays all amounts owed on November 12. Using periodic inventory and net purchases methods, what are the proper entries to record these two transactions? A. Nov. 2 Merchandise Inventory 2,400 Accounts Payable 2,400 nventoryDiscounts Lostecord these two transactions.thod, what are the proper entries to record the pury purchases Nov. 11 Accounts Payable 2,400 Cash 2,400 B. Nov. 2 Purchases 2,328 Accounts Payable 2,328 Nov. 11 Accounts Payable 2,328 Cash 2,328 C. Nov. 2 Purchases 2,328 Accounts Payable 2,328 Nov. 11 Accounts Payable 2,328 Purchase Discounts Lost 72 Cash 2,400 D. Nov. 2 Merchandise Inventory 2,328 Accounts Payable 2,328 Nov. 11 Accounts Payable 2,328 Inventory 72 Cash 2,400 E. Nov. 2 Purchases 2,328 Accounts Payable 2,328 Nov. 11 Accounts Payable 2,328 Purchase Discounts Lost 72 Cash 2,400

Q: A company purchases merchandise on November 2 at a $2,400 invoice price (terms 3/10, n/30) and then pays all amounts owed on December 2. Using perpetual inventory and net purchases methods, what are the proper entries to record these two transactions? A. Nov. 2 Merchandise Inventory 2,400 Accounts Payable 2,400 nventoryDiscounts Lostecord these two transactions.thod, what are the proper entries to record the pury purchases Dec. 2 Accounts Payable 2,400 Cash 2,400 B. Nov. 2 Merchandise Inventory 2,328 Accounts Payable 2,328 Dec. 2 Accounts Payable 2,328 Cash 2,328 C. Nov. 2 Merchandise Inventory 2,328 Accounts Payable 2,328 Dec. 2 Accounts Payable 2,328 Purchase Discounts Lost 72 Cash 2,400 D. Nov. 2 Merchandise Inventory 2,328 Accounts Payable 2,328 Dec. 2 Accounts Payable 2,328 Inventory 72 Cash 2,400 E. Nov. 2 Merchandise Inventory 2,328 Accounts Payable 2,328 Dec. 2 Accounts Payable 2,328 Purchase Discounts Lost 72 Cash 2,400

Q: A company purchases merchandise on November 2 at a $2,400 invoice price (terms 3/10, n/30) and then pays all amounts owed on November 12. Using perpetual inventory and net purchases methods, what are the proper entries to record these two transactions? A. Nov. 2 Merchandise Inventory 2,400 Accounts Payable 2,400 nventoryDiscounts Lostecord these two transactions.thod, what are the proper entries to record the pury purchases Nov. 11 Accounts Payable 2,400 Cash 2,400 B. Nov. 2 Merchandise Inventory 2,328 Accounts Payable 2,328 Nov. 11 Accounts Payable 2,328 Cash 2,328 C. Nov. 2 Merchandise Inventory 2,328 Accounts Payable 2,328 Nov. 11 Accounts Payable 2,328 Purchase Discounts Lost 72 Cash 2,400 D. Nov. 2 Merchandise Inventory 2,328 Accounts Payable 2,328 Nov. 11 Accounts Payable 2,328 Inventory 72 Cash 2,400 E. Nov. 2 Merchandise Inventory 2,328 Accounts Payable 2,328 Nov. 11 Accounts Payable 2,328 Purchase Discounts Lost 72 Cash 2,400

Q: The Discounts Lost account: A. Is used with the gross method of recording purchases to highlight the value of purchase discounts taken. B. Is used with the gross method of recording purchases to highlight the value of purchase discounts available but not taken. C. Is used to note situations where the accounting department has lost or misplaced paperwork relating to inventory purchases. D. Is used with the net method of recording purchases to highlight the value of purchase discounts taken. E. Is used with the net method of recording purchases to highlight the value of purchase discounts available but not taken.

Q: What is the net method of recording purchases? A. A purchase is originally recorded at its full amount with any cash discount taken recorded as a reduction to inventory at a later date. B. A purchase is originally recorded at its full amount less any available cash discount. C. A purchase is originally recorded at its full amount plus any available cash discount. D. A purchase is originally recorded at its full amount with any cash discount taken recorded as an increase to inventory at a later date. E. A purchase is originally recorded to a purchase discounts lost account with any cash discount taken recorded as a reduction to inventory at a later date.

Q: The following information is available to reconcile Sleepy Time Bedding's book balance of cash with its bank statement cash balance as of July 31: a. On July 31, the company's Cash account has a $25,862 debit balance, but its July bank statement shows a $28,177 cash balance. b. Check No. 1531 for $1,520 and Check No. 1540 for $752 were outstanding on the June 30 bank reconciliation. Check No. 1540 is listed with the July canceled checks, but Check No. 1531 is not. Also, Check No. 1565 for $536 and Check No. 1569 for $2,288, both written in July, are not among the canceled checks on the July 31 statement. c. In comparing the canceled checks on the bank statement with the entries in the accounting records, it is found that Check No. 1556 for July rent was correctly written and drawn for $1,240 but was erroneously entered in the accounting records as $1,230. d. A credit memorandum enclosed with the July bank statement indicates the bank collected $9,500 cash on a noninterest-bearing note for Sleepy Time Bedding, deducted a $48 collection fee, and credited the remainder to its account. Sleepy Time Bedding had not recorded this event before receiving the statement. e. A debit memorandum for $805 lists a $795 NSF check plus a $10 NSF charge. The check had been received from a customer, Evan Shaw. Sleepy Time Bedding has not yet recorded this check as NSF. f. Enclosed with the July statement is a $14 debit memorandum for bank services. It has not yet been recorded because no previous notification had been received. g. Sleepy Time Bedding July 31 daily cash receipts of $10,652 were placed in the bank's night depository on that date but do not appear on the July 31 bank statement. What is the appropriate journal entry to record the collection made by the bank? A. Debit to cash $9,500 credit to accounts receivable $9,500. B. Credit to accounts receivable $9,500 credit to cash $9,500. C. Debit to cash $9,452 debit to collection expense $48 credit accounts receivable $9,500. D. Debit to cash $9,452 debit to collection expense $48 credit notes receivable $9,500. E. No adjusting entry is necessary.

Q: The following information is available to reconcile Sleepy Time Bedding's book balance of cash with its bank statement cash balance as of July 31: a. On July 31, the company's Cash account has a $25,862 debit balance, but its July bank statement shows a $28,177 cash balance. b. Check No. 1531 for $1,520 and Check No. 1540 for $752 were outstanding on the June 30 bank reconciliation. Check No. 1540 is listed with the July canceled checks, but Check No. 1531 is not. Also, Check No. 1565 for $536 and Check No. 1569 for $2,288, both written in July, are not among the canceled checks on the July 31 statement. c. In comparing the canceled checks on the bank statement with the entries in the accounting records, it is found that Check No. 1556 for July rent was correctly written and drawn for $1,240 but was erroneously entered in the accounting records as $1,230. d. A credit memorandum enclosed with the July bank statement indicates the bank collected $9,500 cash on a noninterest-bearing note for Sleepy Time Bedding, deducted a $48 collection fee, and credited the remainder to its account. Sleepy Time Bedding had not recorded this event before receiving the statement. e. A debit memorandum for $805 lists a $795 NSF check plus a $10 NSF charge. The check had been received from a customer, Evan Shaw. Sleepy Time Bedding has not yet recorded this check as NSF. f. Enclosed with the July statement is a $14 debit memorandum for bank services. It has not yet been recorded because no previous notification had been received. g. Sleepy Time Bedding July 31 daily cash receipts of $10,652 were placed in the bank's night depository on that date, but do not appear on the July 31 bank statement. What is the adjusted book balance? A. $34,485 B. $34,994 C. $28,150 D. $27,025 E. $31,617

Q: Fluffy Pet Grooming deposits all cash receipts on the day when they are received and all payments are made by check. At the close of business on June 30, its Cash account shows a $14,811 debit balance. Fluffy Pet Grooming's June 30 bank statement shows $14,472 on deposit in the bank. Prepare a bank reconciliation for Fluffy Pet Grooming using the following information: a. Outstanding checks as of June 30 total $2,261. b. The June 30 bank statement included a $75 debit memorandum for bank services. c. Check No. 919, listed with the canceled checks, was correctly drawn for $789 in payment of a utility bill on June 15. Fluffy Pet Grooming mistakenly recorded it with a debit to Utilities Expense and a credit to Cash in the amount of $798. d. The June 30 cash receipts of $2,534 were placed in the banks night depository after banking hours and were not recorded on the June 30 bank statement. What is the adjusting journal entry required as a result to record the increase in cash for the adjusted bank balance? A. Debit to cash $2,261 credit to accounts receivable $2,261. B. Credit to accounts receivable $2,261 debit to cash $2,261. C. No adjusting entry is necessary. D. Debit to cash $2,534 credit to accounts receivable $2,534. E. Credit to cash $2,534 credit to accounts receivable $2,534.

Q: Fluffy Pet Grooming deposits all cash receipts on the day when they are received and all cash payments are made by check. At the close of business on June 30, its Cash account shows a $14,811 debit balance. Fluffy Pet Grooming's June 30 bank statement shows $14,472 on deposit in the bank. Prepare a bank reconciliation for Fluffy Pet Grooming using the following information: a. Outstanding checks as of June 30 total $2,261. b. The June 30 bank statement included a $75 debit memorandum for bank services. c. Check No. 919, listed with the canceled checks, was correctly drawn for $789 in payment of a utility bill on June 15. Fluffy Pet Grooming mistakenly recorded it with a debit to Utilities Expense and a credit to Cash in the amount of $798. d. The June 30 cash receipts of $2,534 were placed in the banks night depository after banking hours and were not recorded on the June 30 bank statement. What is the adjusted bank balance? A. $14,265 B. $14,745 C. $14,677 D. $14,538 E. $14,877

Q: Given the following information: Petty cash balance $530.00 Courier receipt $ 74.22 Postage receipt $ 25.00 Office Supplies receipt $ 95.64 Business meal receipt $ 54.21 Cash on hand at the end of the month $299.71 What is the amount that needs to be recorded for cash over and short? A. Debit $23.29. B. Credit $23.29. C. Debit $18.78. D. No cash over and short is necessary. E. Credit $18.78.

Q: Given the following information: Petty cash balance $530.00 Courier receipt $74.22 Postage receipt $ 25.00 Office Supplies receipt $95.64 Business meal receipt $ 54.21 Cash on hand at the end of the month $299.71 What is the amount that needs to be reimbursed? A. $365.27 B. $289.06 C. $280.73 D. $181.22 E. $230.29

Q: Given the following information: Petty cash balance $450.00 Courier receipt $82.50 Postage receipt $ 48.00 Office Supplies receipt $56.22 Business meal receipt $102.34 Cash on hand at the end of the month $76.21 What is the amount of cash over and short? A. Debit $84.73. B. Credit $84.73. C. Debit $160.94. D. Credit $160.94. E. No cash over or short would be recorded.

Q: Given the following information: Petty cash balance $450.00 Courier receipt $82.50 Postage receipt $ 48.00 Office Supplies receipt $56.22 Business meal receipt $102.34 Cash on hand at the end of the month $76.21 What is the amount that needs to be reimbursed? A. $365.27 B. $289.06 C. $373.79 D. $289.00 E. $450.00

Q: Triple Companys accountant made an entry that included the following items: debit postage expense $12.42, debit office supplies expense $27.33, debit cash over/short $2.19. If the original amount in petty cash is $320, how much is in petty cash before the reimbursement? A. $320.00 B. $202.44 C. $37.56 D. $275.87 E. $278.06

Q: Triple Companys accountant made an entry that included the following items: debit postage expense $12.42, debit office supplies expense $27.33, debit cash over/short $2.19. If the original amount in petty cash is $320, how much was the credit to cash for the reimbursement? A. $320.00 B. $202.44 C. $37.56 D. $39.75 E. $41.94

Q: Triple Companys accountant made an entry that included the following items: debit postage expense $12.42, debit office supplies expense $27.33, credit cash over/short $2.19. If the original amount in petty cash is $320, how much is in petty cash before the reimbursement? A. $320.00 B. $282.44 C. $37.56 D. $39.75 E. $41.94

Q: Triple Companys accountant made an entry that included the following items: debit postage expense $12.42, debit office supplies expense $27.33, credit cash over/short $2.19. If the original amount in petty cash is $320, how much was the credit to cash for the reimbursement? A. $320.00 B. $202.44 C. $37.56 D. $39.75 E. $41.94

Q: Which of the following statements is true regarding the documents in a voucher system? A. All voucher systems are the same. B. Recording a purchase is initiated by an invoice approval. C. A well-designed voucher system will allow department managers to place orders directly with suppliers for control purposes. D. A voucher system is most commonly used in very small companies to make up for the lack of other internal controls. E. A well designed voucher system will eliminate all fraud and error.

Q: The document, also known as the check authorization, that is a checklist of steps necessary for approving an invoice for approval and payments is the: A. Purchase requisition B. Purchase order C. Invoice D. Receiving report E. Invoice approval

Q: The internal document that is prepared to notify the appropriate persons that ordered goods have been received and describes the quantities and condition of the goods is the A. Purchase requisition B. Purchase order C. Invoice D. Receiving report E. Invoice approval

Q: The document that is an itemized statement of goods prepared by a vendor listing the customer's name, items sold, sales prices, and terms of the sale is the: A. Purchase requisition B. Purchase order C. Invoice D. Receiving report E. Invoice approval

Q: The document that the purchasing department prepares and sends to the vendor to place an order is the: A. Purchase requisition B. Purchase order C. Invoice D. Receiving report E. Invoice approval

Q: The internal document prepared by a department manager that informs the purchasing department of its needs is the: A. Purchase requisition B. Purchase order C. Invoice D. Receiving report E. Invoice approval

Q: A seller of goods or services, which is usually a manufacturer or wholesaler, is known as a: A. Vendor B. Payee C. Vendee D. Creditor E. Debtor

Q: In comparing the canceled checks on the bank statement with the entries in the accounting records, it is found that check number 2889 for December's utilities was correctly written and drawn for $970 but was erroneously entered in the accounting records as $790. The journal entry to adjust the books for the bank reconciliation would include which of the following for this situation? A. $180 decrease to Cash and a $180 decrease to Utility Expense. B. $180 increase to Cash and a $180 increase to Utility Expense. C. $180 decrease to Cash and a $180 increase to Utility Expense. D. $180 increase to Cash and a $120 decrease to Utility Expense. E. $970 increase to Cash and a $790 decrease to Utility Expense.

Q: In comparing the canceled checks on the bank statement with the entries in the accounting records, it is found that check number 2889 for December's utilities was correctly written and drawn for $790 but was erroneously entered in the accounting records as $970. The journal entry to adjust the books for the bank reconciliation would include which of the following for this situation? A. $180 decrease to Cash and a $180 decrease to Utility Expense. B. $180 increase to Cash and a $180 decrease to Utility Expense. C. $20 decrease to Cash and a $20 decrease to Utility Expense. D. $20 increase to Cash and a $120 decrease to Utility Expense. E. $970 increase to Cash.

Q: In comparing the canceled checks on the bank statement with the entries in the accounting records, it is found that check number 4239 for November's rent was correctly written and drawn for $7,390 but was erroneously entered in the accounting records as $3,790. When reconciling the November bank statement, the company should: A. Deduct $3,600 from the book balance of cash. B. Add $3,600 to the bank statement balance. C. Add $7,390 to the book balance of cash. D. Deduct $3,600 from the bank statement balance. E. Add $3,600 to the book balance of cash.

Q: In comparing the canceled checks on the bank statement with the entries in the accounting records, it is found that check number 4239 for November's rent was correctly written and drawn for $3,790 but was erroneously entered in the accounting records as $7,390. When reconciling the November bank statement, the company should: A. Deduct $3,600 from the book balance of cash. B. Add $3,700 to the bank statement balance. C. Add $7,390 to the book balance of cash. D. Deduct $3,600 from the bank statement balance. E. Add 3,600 to the book balance of cash.

Q: A company wrote a check on September 30 that did not appear on the bank statement dated September 30. In preparing the September 30 bank reconciliation, the company should: A. Deduct the check from the bank statement balance. B. Send the bank a credit memorandum. C. Deduct the check from the September 30 book balance and add it to the October 1 book balance. D. Add the check to the book balance of cash. E. Add the check to the bank statement balance.

Q: A company made a bank deposit on September 30 that did not appear on the bank statement dated September 30. In preparing the September 30 bank reconciliation, the company should: A. Deduct the deposit from the bank statement balance. B. Send the bank a debit memorandum. C. Deduct the deposit from the September 30 book balance and add it to the October 1 book balance. D. Add the deposit to the book balance of cash. E. Add the deposit to the bank statement balance.

Q: A deposit in transit on last period's bank reconciliation is shown as a deposit on the bank statement this period. As a result, in preparing this period's reconciliation, the amount of this deposit should be: A. Added to the book balance of cash. B. Deducted from the book balance of cash. C. Added to the bank balance of cash. D. Deducted from the bank balance of cash. E. Not included as a reconciling item.

Q: A check that was outstanding on last period's bank reconciliation was not included with the canceled checks returned by the bank this period. As a result, in preparing this period's reconciliation, the amount of this check should be: A. Added to the book balance of cash. B. Deducted from the book balance of cash. C. Added to the bank balance of cash. D. Deducted from the bank balance of cash. E. Ignored in preparing the period's bank reconciliation.

Q: Which of the following statements best describes how GAAP and IFRS treat cash? A. Accounting definitions for cash are similar for U.S. GAAP and IFRS. B. IFRS are more strict about what is considered cash than GAAP . C. GAAP is more strict about what is considered cash than IFRS. D. IFRS requires a cash balance of at least 10% of total assets; IFRS requires a cash balance of at least 5% of total assets. E. GAAP requires anything other than coins and bills in hand to be classified as cash equivalents while IFRS classifies coins and bills as cash equivalents.

Q: Outstanding checks refer to checks that have been: A. Written, recorded, sent to payees, and received and paid by the bank. B. Written and not yet recorded in the company books. C. Held as blank checks. D. Written, recorded on the company books, sent to the customer, supplier, or creditor but not yet paid by the bank. E. Issued by the bank.

Q: On a bank reconciliation, an unrecorded debit memorandum for printing checks is: A. Noted as a memorandum only. B. Added to the book balance of cash. C. Deducted from the book balance of cash. D. Added to the bank balance of cash. E. Deducted from the bank balance of cash.

Q: An analysis that explains any differences between the checking account balance according to the depositor's records and the balance reported on the bank statement is a (n): A. Internal audit. B. Bank reconciliation. C. Bank audit. D. Trial reconciliation. E. Analysis of debits and credits.

Q: A company had $43 missing from petty cash which was not accounted for by petty cash receipts. The correct procedure is to: A. Debit Cash Over and Short for $43. B. Credit Cash Over and Short for $43. C. Debit Petty Cash for $43. D. Credit Petty Cash for $43. E. Credit Cash for $43.

Q: A company plans to decrease a $200 petty cash fund to $75. The current balance in the account includes $45 in receipts and $165 in currency. The entry to reduce the fund will include a: A. Debit to Cash Short and Over for $10. B. Debit to Cash for $90. C. Debit to Miscellaneous Expenses for $35. D. Credit to Petty Cash for $165. E. Credit to Cash for $90.